1. Field of the Invention
The present invention relates generally to electronic commerce transactions. Specifically, the invention relates to a method and system for using the internet or similar network to coordinate exchanges of items between parties.
2. Background of the Invention
Before the internet became popular, an individual who wanted to sell or exchange a personal item could do little more than place an advertisement in the “Classifieds” section of the local newspaper. The market would thereby be limited to the newspaper's readership. For those who wished to exchange certain types of commonly-exchanged items ranging from books and CDs to time-shares, clubs formed that allowed members to swap such items amongst themselves. But such clubs were also confined to local areas since the logistics and long distance communication required to arrange frequent exchanges was impractical.
The internet (or “World Wide Web” as it is also commonly known) is a worldwide collection of computers and computer networks cooperating to exchange data using a common software standard. The infrastructure of the internet consists of computers of all sizes and capabilities connected in networks within networks by way of telephone wires, fiber optic cables, and satellite links. The common standard that allows all of these computers to speak the same language is known as the TCP/IP protocol. Through this vast interconnection of computers, internet users can send and receive messages, share computer data, post information for others to view, and access multimedia information including audio and video.
Since the pervasiveness of the internet has exploded to what it is today, a number of methods have been developed to help individuals conduct simple transactions over the internet. For example, computer-based classified ads and electronic bulletin boards exist in great numbers, providing people with places to post their advertisements. A number of systems exist wherein would-be sellers enter ads into a computer-managed database that can be searched by prospective buyers. Online classified ad systems are effective for those who want maximum exposure for their listings since they provide a highly visible place to post ads. Classified ads, however, are best suited for one-time transactions in which the seller is looking to sell her product, and proceeds from the sale can be used to cover the costs of placing the classified ad. Moreover, the classified ad method of conducting business consists of one-sided, seller-driven transactions since the advertising party simply posts an advertisement and waits to be contacted. Consequently, even simple exchanges of items, as between two parties, cannot easily be arranged through classified ads.
Online auctions have become extremely popular of late since the internet facilitates the accepting of bids from anywhere in the world. Many internet sites allow individuals to place virtually any item up for sale to the highest bidder. Several systems exist that employ computers to process bid information from bidders spread over a wide area. Others teach systems for conducting real-time auctions over the internet. The auction-method of transacting business is very efficient and accurate in establishing the value of an object for sale. However, auctions are limited to one-time buying/selling transactions, as the winning bidder is simply the person who agrees to pay the highest price. As with online classified ads, online auctions do not satisfy the needs of people who wish to swap items on a regular basis; nor are they used to offer an item for anything other than cash.
The success of online classified ads and auctions shows how drastically the internet has increased the power individuals have in conducting their personal business. Anyone can take advantage of the internet's global scale to instantly and inexpensively advertise items on a national or worldwide scale. Conversely, people in search of particular items now have vastly more options to choose from. But along with this enormous increase in options come the difficulties associated with efficiently finding and managing them. A person could spend hours online searching through multitudes of items before finding exactly the right item.
A number of systems have been developed to efficiently sort through buying, selling, and exchanging opportunities. The general goal of such efficiency-enhancing search systems is to enable users to quickly and easily find precisely the item they are looking for without having to sift through incredible amounts of clutter. The relevant “user” is almost always a buyer or a seller, but may in some cases, be someone looking to exchange or swap items.
Computer-assisted systems for interactively brokering goods and services between potential buyers and sellers have been proposed. Such systems facilitate buying/selling transactions for a wide variety of goods and services by first storing information about the seller's item, and then assisting buyers in searching the database based on criteria important to the buyer. Seller-driven systems such as these are by far the most common and take many forms including the classified ads and auctions discussed above.
Another system proposed consists of an analogous buyer-driven system. This system generally operates in the form of “want ads” where buyers communicate purchase offers globally to prospective sellers. Sellers may then conditionally accept the offer by way of a central controller computer which receives the bids and communicates them to the buyer for confirmation. A similar proposed system discloses an automated system to assist buyers in locating and purchasing satisfactory goods from a variety of vendors.
Finally, a commerce system may be exchange-driven, rather than buyer or seller driven. The most well known examples of exchanges are stock and commodities exchanges such as the New York Stock Exchange and the Chicago Mercantile Exchange. Exchanges match buyers and sellers through an orderly marketplace, guaranteeing that once an exchange has been agreed to, both parties will perform as expected. Such securities exchanges may be automated.
Automated exchange-type systems have been implemented outside of the securities context, as well. A computer-based system for matching buyers and sellers of property such as real estate, businesses, and other assets has been proposed. Such a system stores records of property to be sold that can be searched based on specific criteria by potential buyers who provide information to the seller regarding their interest in the property. In addition, the system has provisions to screen potential buyers to ensure that they meet certain financial criteria.
While existing exchange systems generally provide a marketplace for persons interested in acquiring and disposing of various items, they generally do not broker exchanges of like items between individuals. The old-fashioned book club where members meet to swap books they have read has not been displaced by the advent of the internet. There is no forum on the internet that allows the local book club to extend its reach, and more importantly, no system for implementing such a forum has been developed. Moreover, existing systems do not actually perform automated matching of multiple parties with complementary criteria.
Consequently, a need exists to provide the average person with the ability and the forum to exchange goods via the internet or similar distributed network. The need exists for a system that actively and automatically matches two or more persons with complementary criteria when the exchange of money is not part of the transaction. The need further exists for a system that would take advantage of the extraordinary reach and efficiency of the internet, while not requiring any special equipment or added expense beyond a standard personal computer. Finally, the need exists for a system that would broker exchanges between individuals in a timely and efficient manner, while maintaining an orderly marketplace by ensuring that all parties are qualified to take part in exchanges.